“Along with achieving our financialtargets for 2013, we also made significantprogress and achieved numerous mile-stones on our long-term strategic imper-atives,” said Thomas J. Hook, presidentand CEO of Greatbatch. “This includedour [U.S. Food and Drug Administrationpremarket approval] filing for our spinalcord stimulation system to treat chron-ic intractable pain of the trunk and/orlimbs. We subsequently filed for CE markapproval in January of this year. Our in-tellectual property portfolio continuesto expand with one third of the portfo-lio representing medical device patents.Through our new functional organiza-tion, we were able to improve and expandour sales and marketing efforts and de-liver productivity improvements. We arerenewed in our belief that our [research,development and engineering] and salesand marketing investments, coupled withour operating discipline, position Great-batch to meet its long term objectives ofmaintaining 5 percent organic constantcurrency growth and double-digit adjust-ed diluted (EPS) growth.”Greatbatch is based in Frisco, Texas.The company makes critical medical de-vice technologies for the cardiac, neu-romodulation, vascular and orthopedicmarkets, as well as batteries for high-endniche markets including medical.

Halted Clinical Trial SendsMedtronic’s Q3 ProfitsPlummeting

Medtronic Inc.’s failed renal denervation
clinical trial cost the company quite a bit
of cash in the third fiscal quarter.

Burdened with $200 million in charges for its stalled renal denervation program, net earnings for the three-month
period ending Jan. 24 fell 23 percent
to $762 million, or 75 cents per diluted
share, according to the Minneapolis,
Minn.-based device behemoth’s latest
financial report. Third quarter net earnings and diluted earnings per share on a
non-GAAP basis were $916 million and
91 cents, a decrease of 3 percent and 2
percent, respectively, compared with the
same period in fiscal 2013.

Medtronic officials claim the $200 million in charges were a one-time hit. The
company’s earnings, they insisted, would
otherwise have been more in line with Wall
Street expectations.“We believe this will be
it,” said Gary Ellis, Medtronic senior vice
president and chief financial officer.

Analyst Jeff Windau of Edward JonesInvestments said most analysts were notput off by the one-time hit from renal de-nervation. “In the big picture, it’s a littlebit disappointing,” he told the Minneapo-lis Star-Tribune of the suspended trials.“The technology had a lot of promiseand growth potential. It’s not out of thepicture yet, so we may still see it comingdown the pipeline.”Several other analysts, in notes to in-vestors, said Medtronic’s earnings andrevenue numbers were in line with orslightly better than expectations.

Windau said that was because“growthin their biggest groups was pretty well flat.I think, overall, the quarter was very neu-tral for the company.”The company reported worldwidethird quarter revenue of $4.163 billion, a3. 3 percent increase compared with the$4.03 billion reported in the third quarterof fiscal year 2013.

Third quarter international revenue of
$1.89 billion jumped 4 percent on a constant currency basis or 2 percent as reported. International sales accounted for 46
percent of Medtronic’s worldwide revenue
in the quarter. Emerging market revenue
of $521 million increased 12 percent on a
constant currency basis or 10 percent as
reported and represented 13 percent of
company revenue.

CRDM revenue of $1.18 billion grew 2
percent on a constant currency basis or 1
percent as reported. Third quarter revenue
from ICDs was $655 million, an increase of
1 percent on a constant currency basis. In
international markets, strong adoption of
the Viva XT CRT-D drove growth in Western Europe and Japan. Pacing revenue was
$439 million, a decline of 2 percent on a
constant currency basis. AF Solutions
grew more than 20 percent, driven by robust growth from the Arctic Front Cryo-Ablation System, which increased more
than 30 percent.

The Restorative Therapies Group,
which includes the Spine, Neuromodula-tion and Surgical Technologies businesses,
generated $1.6 billion in worldwide sales,
an increase of 5 percent on a constant
currency basis or 4 percent as reported.
Group revenue was driven by growth in
Surgical Technologies and Neuromodu-lation. Group international sales of $521
million increased 6 percent on a constant
currency basis or 3 percent as reported.

Spine revenue of $744 million was flat
on a constant currency basis or declined 1
percent as reported. Core Spine revenue
of $631 million was flat on a constant currency basis or declined 1 percent as reported. Excluding sales of balloon kypho-plasty, Core Spine grew in the low-single
digits on a constant currency basis both
globally and in the United States. Bone
morphogenetic protein revenue of $113
million declined 1 percent, as the business
is seeing signs of sequential stability in
underlying demand and faced a favorable
comparison due to a supply constraint in
the prior year period. v